My mother set up an offshore Discretionary Loan trust Bond with Friends Provident International in 2012, through her Bank Financial Advisor ( the band no longer have their own advisors) The Loan trust was set up with £120,000. My mum, sister and myself were trustees and my sister, 2 brothers and I are the beneficiaries.
My mum passed away in December 2017. We have now completed Probate and the £120,000 loan was declared as part of the estate on the probate forms but no IHT was payable on the estate.
Because we were also trustees the loan trust Bond has continued on mum's death and we focused on sorting out he estate. We now want to encash the Bond and distribute it between the four of us. I assume that the £120,000 loan part of the trust will have no tax implications as it is part of the estate. However I am confused as to what Tax may be payable on the gains made in the Bond. What type of tax will be due and who will be responsible for paying it? Is it the individual beneficiaries or the Trustees? How are any gains between my mum's death and now dealt with? Do we need to register the loan Trust with HMRC when we encash the Bond? ( we did complete a trust form as part of Probate but only to declare the Loan of £120,000 as part of the estate, no other information was given) Do I need to do a tax return for my mum?
Anyone's thoughts on this would be much appreciated
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